Finance minister to be Japan's next prime minister

AP

TOKYO, AUG 29 -

Japan's ruling party elected Finance Minister Yoshihiko Noda as its new chief Monday, paving the way for him to be the next prime minister and inherit the daunting task of recovering from the huge tsunami and nuclear crisis.

Noda, 54, is known as a fiscal conservative and has lately been battling a sluggish economy, bulging national debt and the yen's record surge, which hurts Japan's exporters by making their products more expensive overseas.

As prime minister — Japan's sixth in five years — he will have to broaden his scope to deal with the continuing reconstruction from the March 11 quake and tsunami along the northeastern coast and the 100,000 people who remain dislocated because of radiation leaking from a tsunami-damaged nuclear plant.

"Let us sweat together for the sake of the people," he said after the vote. "This is my heartfelt wish."

Noda replaces Prime Minister Naoto Kan, who resigned after nearly 15 months in office plagued by public discontent over political infighting and his administration's handling of the disasters.

Noda defeated Trade Minister Banri Kaieda — who was backed by an influential behind-the-scenes party kingpin — in a run-off election 215-177 among ruling party members of parliament after none of the initial five candidates won a majority in the first round. Noda will go on to become prime minister because the Democrats control the more powerful lower house of parliament.

After the vote, Noda said the three most pressing challenges facing the nations are recovering from the tsunami, bringing to a close the nuclear crisis and dealing with the strengthening of the yen and the deflationary pressure it has put on Japan's economy.

Noda came from behind to win the run-off, getting 102 votes in the first round to Kaieda's 143. The result could be seen as a slap against Ichizo Ozawa, a scandal-tainted party powerbroker who threw his support behind Kaieda.

Ozawa, a 69-year-old veteran who began in the long-ruling and now opposition Liberal Democratic Party, is known for savvily engineering elections, sending novices to parliament, as well as dooming candidates to defeat. His is embroiled in a political funding scandal but his presence has hung like a shadow over the party leadership campaign.

Noda is a staunch supporter of the Japan-U.S. security alliance, which he has called "essential for Japan's security and prosperity." And while praising China's economic development, he has cited concerns about their growing military strength.

As finance minister since June 2010, Noda has been contending with budgets and a strong yen, which hit a post-World War II high against the dollar earlier this month.

Noda must also deal with a divided parliament, which has increased gridlock, after the opposition won control of the upper house last summer.

Japan has been plagued by rapid turnover in political leadership that has undermined its ability to tackle serious problems. The past five prime ministers lasting about a year each; Kan lasted the longest at nearly 15 months.

Kaieda is the third Democratic leader since the party surged to a landslide victory two years ago, dumping the long-ruling conservatives, amid widespread hope for change.

Those hopes have been largely dashed amid public disappointment over scandals, persistent political infighting — in parliament and within the ruling party — and a perceived lack of decisive leadership.

Noda is not from an elite background like many Japanese politicians. He began honing his political skills at a postgraduate institute designed to groom a new generation of progressive leaders.

Before he took on a ministerial post, he was known for standing at train stations in his district in Chiba, just east of Tokyo, every morning to greet commuters personally.